Chris Hipkins: Labour leader on the party's new scheme designed to help out small businesses

Labour says its new election policy aimed at small businesses is about making life a little easier.

If it gets into power, the Labour will raise the GST threshold, lift asset write-offs and require big businesses to pay up faster.

It would axe the current Government's Investment Boost, which lets businesses deduct 20 percent of the cost of a new asset.

Leader Chris Hipkins says small businesses shouldn't be a line of credit for big businesses. 

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Episode Transcript

Speaker 1 (00:00):
Now, in the last week that Christopher Luxe's apologized to
small businesses, the Labor Party is now trying to woo them.
The Labor leaders released party policy focused on small businesses.
It includes requiring big companies to pay small supplies within
fifteen days for smaller invoices up to twenty five thousand dollars,
and also raising the GSD registration threshold from sixty thousand
to eighty thousand dollars. The Labor Party leader is, of course,

(00:21):
Chris Hopkins. Chippy.

Speaker 2 (00:22):
Hello, good a, Heather.

Speaker 1 (00:24):
Before we get to your announcement, can I just talk
to you about the MMP referendum? Yes or no from you?

Speaker 2 (00:29):
No? Clear no from us. Voters kept their say on
this just as recently as twenty eleven. They were very clear.
It was pretty decisive vote in favor of keeping MMP.
So we should just get on and make that work.

Speaker 1 (00:39):
Listen, we've already had Winston speculating as to why the
PM did it this morning. He reckons it's desperation from
the PM. I reckon the PM just agreed with Kerry
because Kerry liked it. What's your theory?

Speaker 2 (00:48):
Oh, clearly there was no plan here. He clearly just
spat it out. I don't think there was much thought
that went into it. But I think Christoph Luxe's feeling
the pressure because he can't manage a government under MMP
because he seems to have an inability to work and
a team.

Speaker 1 (01:01):
Now, listen on your policy. Okay, so raising the GST
registration threshold from sixty to eighty thousand dollars, I think
a lot of people are going to like. But what
are the businesses that we are talking about here? Is
it just little airbnbs and you know that kind of stuff.

Speaker 2 (01:15):
It'll be a lot of people who are providing sort
of professional services where the main thing that they're offering
is their time and their expertise. Because if you're a
small business and you're doing a lot of stuff where
you're buying and selling goods, registering for GST is probably
still going to make sense through you because you can
claim back GSD on the stuff you're buying. But if
you're selling your time and your labor. So a personal
trainer is a good example. A personal trainer takes on clients,

(01:36):
they get up to sixty grand, they say I'm not
going to take on anymore because that would mean a
whole lot more paperwork. Well, now they'll be able to
take on another twenty thousand dollars worth of clients without
having to go through all of that.

Speaker 1 (01:47):
We're talking about part time work here, right, this is
not full time work.

Speaker 2 (01:51):
Well, it depends on the nature of the work. But
you know, personal trainers people, many of the people who
are going to benefit from this, people who do the
sort of work that gives them a lifestyle choice that
they wouldn't have if they were in a more regularized employment.
So a personal trainer, someone delivering some consultancy services, those
sorts of people.

Speaker 1 (02:08):
Yeah, the stuff about getting them to pay invoices worth
less than twenty five thousand dollars within a certain period
of time and then publish that results. Where are you
expecting them to publish that information?

Speaker 2 (02:20):
Oh, there are said guidelines set out they could publish
an annual report. I think it's a law change that
was and that we actually got in place when we
were previously in government, and it was repealed by the
current government. I never quite understood why they did that, because,
you know, small businesses shouldn't be a line of credit
for big businesses. Big businesses should be able to pay
their invoices on time.

Speaker 1 (02:41):
Why are you cutting the investment boost.

Speaker 2 (02:44):
Ultimately, we've went out and spoke to small businesses about
what's going to make the biggest difference for them. Ninety
seven percent about businesses in New Zealand fall into that
small business category, and they said far more than investment boosts.
The thing that's going to make the difference is the
ability to immediately expense small asset purchases. So at the
moment you can only expense a purchase up to ten

(03:04):
up to one thousand dollars. We're increasing that to ten
thousand dollars and small businesses are really clear that actually
will make a bigger difference to them than the investment boost.

Speaker 1 (03:12):
Eve But why scrap the investment boost because this is
I mean, don't we want people to be putting money
in the capital.

Speaker 2 (03:19):
It's a lot of money that the government have put
aside for investment boosts. When businesses have said that it's
not actually making any difference to their investment decisions, more
than half of the businesses told the idea it doesn't
make any difference, but.

Speaker 1 (03:31):
That's still almost half who are using it.

Speaker 2 (03:35):
Well, those businesses that have committed or are about to
commit will still benefit from investment boosts because it's not
going to be removed until the middle of next year,
till the thirtieth of June next year. So we're not
taking anything away from those businesses or depending on it
based on the decisions that they're making now. But we're
saying in the longer term, we think that supporting small
businesses and giving small businesses what they're after is the

(03:57):
thing that's going to have a bigger difference to New
Zealand's economy. Can't in the immediate term.

Speaker 1 (04:01):
Why can't we do it? Look, I know it's pricey,
but this is exactly where we should be putting our money,
isn't it, Because because this this kind of stuff, this
capital investment, is the kind of stuff that's going to
lift our productivity.

Speaker 2 (04:13):
Yeah, but there's no evidence to suggest that that's what's happening.
You know, the government said that this was the thing
that's going to save the economy since the unemployment's gone
up in the economy hasn't grown.

Speaker 1 (04:20):
But no, but those are two in related things. But Chippy,
what's the evidence that it's not working?

Speaker 2 (04:25):
Well? Business is saying that that's not making a decision
to the only difference to.

Speaker 1 (04:30):
The only half of them.

Speaker 2 (04:33):
Well more than half. Heather and a significant number of
others were pretty skeptical as well. So it's it's not
making the difference that the government thinks that it is
all right.

Speaker 1 (04:43):
Chippy, thank you. I really appreciate Tom. Thanks for coming
on the show. Chris Hepkins, Labor Party leader.

Speaker 2 (04:48):
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